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What is a Good Interest Rate for Your Car Loan?

Man Holding Car Keys

 

What is the average interest rate on a car loan? To avoid overpaying, every Vancouver car buyer should have an idea how car age and credit score impact the interest rate of your auto loan. So you can better understand what interest rates to expect, we’ve created a chart, along with a guide showing how to get the best interest rate possible. Learn more about the average new and used car loans based on credit scores and the APR (Annual Percentage Rate) for that average. Once you’re armed with all the information, work with our financing department to secure that rate!



APR for New and Used Cars

Average New-Car Loan Annual Percentage Rate Average Used-Car Loan Annual Percentage Rate
781-850 3.17% 781-850 3.8%
661-780 4.03% 661-780 5.48%
601-660 6.79% 601-660 10.1%
501-600 10.98% 501-600 16.27%
300-500 13.76% 300-500 19.32%

Tips for Getting the Best Interest Rate Possible

The first thing you’ll need to do to land a great interest rate is plan ahead. Check your credit history and note the score. The higher the credit score, the lower your interest rate. After you’ve consulted our chart for a rate estimate, plan for the rate you want. Once you have a rate in mind, be prepared to negotiate if they offer you something higher than you expected. Make sure you don’t become so focused on the interest rate that you overlook the rest of their offer. Pay close attention to the details.

What is the Average Interest Rate on a Car Loan?

With a typical three-year car loan, the industry average interest rate is around 3% to 4.5%. Keep in mind though, the interest rate you’re offered may be different based on your credit score, as well as where you’re getting the loan. In the end, the easiest way to compare your car loans and interest rates is to shop around or get pre-approved and compare that way.

Get Financing Help at Mercedes-Benz of Portland

If you want a finance team that’ll be in your corner during the financing process, you can rely on the team at Mercedes-Benz of Portland. We offer an easy online pre-approval process to get you behind the wheel of your dream vehicle at a reasonable rate. Browse our car buying tips, or get in touch to get the process started!

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1605 SW Naito Parkway • Portland, OR 97201

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Mercedes-Benz of Portland 45.511462, -122.676529.